UK unveils new strategy to boost domestic critical minerals supply, reduce foreign reliance

The UK government has unveiled a new critical minerals strategy aimed at strengthening the UK's access to critical raw materials and reducing its current overreliance on foreign suppliers.

Announced on Nov. 22, the strategy aims to boost the UK's domestic production, including the extraction, processing and refining of critical minerals, to at least 10% of domestic demand by 2035. In support of this target, the government aims to strengthen the UK's domestic production of lithium carbonate equivalent to at least 50,000 metric tons/year by 2035.

Emphasizing the importance of mineral recycling, the strategy also seeks to boost domestic supply by increasing the domestic recovery of critical minerals to 20% of total annual UK demand by 2035.

The UK will also limit reliance on any single country for more than 60% of its supply of any critical mineral by the mid-2030s, addressing vulnerabilities highlighted by China's dominance in global mining and refining.

New focus on 'growth minerals'

As part of this effort, the UK has released a list of "growth minerals" to complement the critical minerals identified in the 2024 Criticality Assessment. Aimed at providing an expanded focus on the current and future mineral needs, the growth minerals list is accompanied by demand signals across key technologies in the growth sectors.

It added that both the critical mineral list and the growth minerals list provide the government with the ability to respond to global supply risk while adopting a forward-looking approach to securing critical minerals for the UK.

Funding boost for critical minerals projects

According to the government, the critical minerals sector contributes GBP1.79 billion ($2.34 billion) to the UK economy, with more than 50 critical mineral projects based in the UK, including established production facilities as well as mining, processing or recycling projects at various stages of development.

The new strategy allocates up to GBP50 million in funding for UK businesses to scale mineral extraction, refining, processing and recycling. This funding will be provided alongside wider public finance tools, including the National Wealth Fund and UK Export Finance, which have already provided more than GBP165 million to UK critical mineral firms.

In addition, the strategy aims to reduce electricity costs for domestic mineral producers through the upcoming British Industrial Competitiveness Scheme (BICS), with a consultation on eligibility to be launched imminently. The strategy also commits to fast-tracking environmental permitting for mining and recycling projects through the Environment Agency's priority-tracked service.

To boost resilience, the government said that it is also considering "targeted, industry-led resilience measures for the UK defense sector, including stockpiling critical minerals for defense applications.

The government added that it will support UK critical mineral supply chains by building and leveraging international partnerships through multilateral forums such as the G7, G20, Minerals Security Partnership, International Energy Agency and NATO.

Prime Minister Keir Starmer said that the strategy was crucial for both national security and economic growth.

"Critical minerals are the backbone of modern life -- powering everything from smartphones and fighter jets to electric vehicles and wind turbines. Britain has been dependent on a handful of overseas suppliers for too long," he said. "We are taking decisive action to boost domestic production, ramp up recycling and back British businesses so we can compete globally and drive down costs at home."

Industry minister Chris McDonald said building secure supply chains was essential to "shoring up national security" and supporting high-growth sectors in the government's Plan for Change.

UK-based project developers welcomed the new Critical Minerals Strategy.

"The refreshed strategy recognizes the urgency of improving the UK's supply chain security for critical minerals, utilizing our existing strengths to develop midstream processing capacity in established regional clusters," said Tees Valley Lithium CEO Vikki Jeckell in an emailed statement.

"Johnson Matthey welcomes the government's refreshed Critical Minerals Strategy and its focus on resilience and circular supply. It's an important step and we believe the UK will go further, faster, by recognizing the economic importance of processing and recycling," said Johnson Matthey CEO Liam Condon.

"With the release of the Critical Minerals Strategy, the Government is sending a strong message about the importance of critical minerals to the nation's growth, prosperity and security," said IonicRE CEO Tim Harrison. "We welcome the strategy's focus on domestic capability and the recognition of Belfast, where Ionic Technologies operates, as part of a critical minerals cluster.

Platts daily CIF Europe assessments for battery-grade lithium hydroxide and carbonate were both assessed at $10,800/mt on Nov. 21, stable day over day and the week, but up over $1,000/mt month over month.